Bank account considerations

terei

Just some general info that may help some. Sometimes being added to checking + savings account as signatory is more advisable than using a DPOA. If your LO can sign, they can be taken to the bank(or whatever the bank requires) + ask to have you added to the account. This is sometimes easier than dealing with a POA. Also, remember, a POA is invalidated immediately at the death of the grantor. If you are on the account as a signer, you will still be able to use the accounts for the LO’s benefit without being subject to any delays because of probate etc.

The above should be able to easily be done with both checking + savings accounts.

With CDs, the LO ideally should make sure there is a ‘payable on death’ beneficiary on each CD or brokerage account so they also bypass probate. Multiple beneficiaries can be named if necessary.

These things should be done as early as possible so that the LO is able to agree + sign. Generally, The LO should remain as the ‘main’ owner of the accounts + be reported on their social security # for tax purposes

mpang123

I'm taking my mom to the bank and discuss options.

TrumpetSwan

Thank you. I was just wondering about this. Both parents have each other listed as the primary on their DPOA with me as secondary "in case one becomes unable to act on their own." As long as both are still living, and two doctors do not deem them both incompetent, there is not much I seem able to do as the secondary one listed.

I also like the aspect that being added to their checking and savings account means upon their death I will still be able to pay their bills until all property is sold.

fmb

Consult an attorney before doing this. There are negative factors to consider. For example, the joint owner will inherit the entire account upon the other owner's death. This can mess up the allocation of assets in a will, since the account passes outside of probate. Each co-owner's creditors have a claim to this account under any legal action, including divorce. There may also be tax consequences. If the added person turns out to not be a good choice, it is very hard to remove them from the account. Under a POA, the person named has a legal, fiduciary obligation to use the funds for the account owner's benefit, but no such protection exists if they are simply a joint owner.

My brother, a retired CPA and DPOA designee for our mother, initially had himself added as a co-owner to her bank account based on poor advice from her bank. After consulting with an attorney, he removed himself as co-owner and instead exercised the DPOA powers. He also set up a separate, dedicated bank account in order to pay her bills and make purchases on her behalf without co-mingling her funds with his personal funds.

Quilting brings calm

I’m on my mom’s account. And I am her POA. I don’t comingle any funds. All moneys going into that account are hers. All items being paid from that account are for her bills or needs. Most of which are automated. I make notes of grocery receipts etc.
I’m not worried about the money after death. There either won’t be any, or I will write checks out of the account to my siblings and step-siblings. Just as if it had been part of the estate. There’s nothing of value to be in the estate after a number of years in AL.

mpang123

My nephew and I are co-agents in the DPOA.We can act jointly or independently. My sister is the successor. However, my nephew is the sole beneficiary upon my mom's death even if my dad survives my mom.

harshedbuzz

It's interesting. Mom's bank manager offered this as a suggestion, but I was wary of a situation in which I was sued or divorced and her funds were at risk. In retrospect, one small account with me on it would be simpler. I do have POA and have had it vetted by the bank already.

HB

forbarbara

I’m POA and use MIL’s checking account to pay her bills. I disposed of all her personal property when she went into MC. Her attorney advised me to do that quickly. Her remaining asset is money, which is in a revocable trust which she set up years ago, and I’m now co-administrator with her. So I’m already finished with all the family ugliness about assets. I’m still working on forgiving and grace but that’s another story.